The European Commission has said it is open to doing a deal with Coca-Cola in a long-running anti-trust row.

But, the Commission also warned that legal action would remain an option if a settlement was not possible.

Spokesman Tilman Lueder said the Commission wants to change the firm's business practises amid concerns it is using its muscle to gain shop space.

A spokesman for Coca-Cola's European business confirmed talks with the Commission were underway.

During the Commission's long-running probe, the two sides have been exchanging ideas on a possible settlement for the past year.

Legal remedy

Mr Lueder added: "Our double-track approach indeed would entail that on one hand we are trying to reach a settlement, which is quick and which will introduce competition on the supermarket shelves.

"But on the other hand, if that is not possible we have the legal remedy at our disposal."

The Commission has been concerned that the soft drinks giant has been linking sales of its leading cola drink to its less well-known brands by offering inducements to make shelf space for both products.

It has also investigated the group's requirement that only Coca-Cola products go into Coke fridges.

Although the current talks focus on Coke's practises in Germany, and measures suggested by the Commission are also likely to cover the remaining 24 European Union states.